Activate Tech and Media Outlook 2016

At Activate, we've identified the 9 most important insights for tech and media in 2016. Key points:

* The average American spends more time on tech and media than on work or sleep
* Messaging will blow past social networking as the dominant personal media activity
* The next big winners in streaming music and audio are already (quietly!) here
* The long-awaited cord cutting moment isn't coming any time soon
* There is potential for a "cable killer" to show up, but it won't look like you expect
* E-sports and wagering really are going to change the game in gaming
* Want to get rich in the App Store? Good luck!
* These are the companies grabbing all the money in consumer tech and media
* And we demonstrate a simple way to predict what acquisitions and partnerships tech and media companies will be making to stay competitive

Also available here:
http://www.wsj.com/articles/think-again-nine-top-insights-into-tech-and-media-for-2016-1445618763
http://www.businessinsider.com/michael-wolf-predicts-what-will-happen-in-the-tech-industry-in-2016-2015-10

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 3 The 9 most important insights for tech and media in 2016 www.activate.com

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 4www.activate.com

All of this attention is
split up across relatively few apps, sites and channels 9 TIME AND ATTENTION www.activate.com APP SHARE OF TIME SPENT TV CHANNEL CONSUMPTIONWEBSITE SHARE OF TIME SPENT 5 79% of time spent on 5 WEBSITES 27 apps used per month 18 100% of time spent on Actual Consumption for Apps, Websites, TV Channels, U.S., 2014 APPS 44% of time spent on 96 websites visited per month 194 average available channels CHANNELS Sources: Nielsen, Comscore, Ars Technica, TechCrunch, Internetlivestats, Digitalsmiths, Activate analysis. Averages across all users with access

We can find growth opportunities
in people’s online behavior: how many users visit the top websites and apps, and for how long? 10 TIME AND ATTENTION www.activate.com MUVs vs. Minutes per Visitor per Month, U.S., January - September 2015 TimeSpentperVisitor(Minutes) 0 200 400 600 800 1,000 1,200 Monthly Unique Visitors (millions) 0 55 110 165 220 275 Major businesses are built on minutes of user time A few properties and platforms capture the lion’s share of user time Sources: comScore, Activate analysis

A billion dollar business can
be built by capturing less than a minute of an average user’s daily attention 11 TIME AND ATTENTION www.activate.com 9 SECONDS $2.9 B Average Time per User (MUV) per Day, U.S., Valuation (in billions) 16 SECONDS $2.5 B 10 SECONDS $1.8 B 36 SECONDS $1.5 B 19 SECONDS $1.0 B 17 SECONDS $1.0 B Sources: CB Insights, ComScore, Activate analysis. Average Time per User per Day based data for months August 2014-2015

AmazonEcho Multitasking will continue to
grow as new products and experiences expand the number of multitasking moments 14 TIME AND ATTENTION www.activate.com GoogleSelf-DrivingCar MicrosoftHoloLensDisneyPlaymation Sources: Google, Microsoft, Aldebaran, Disney / New York Times

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 15www.activate.com

Sources: LINE.com 24 MESSAGING www.activate.com
Apps built on top of messaging enable users to solve broad problems; messaging becomes a hub for consuming content, playing games, and conducting transactions LINE Example LINE Taxi LINE Payments LINE Music LINE TV LINE Games

Sources: snapchat.com, Re/Code, The Information,
Activate analysis 28 MESSAGING www.activate.com While Snapchat is growing quickly, the company has not yet developed a consistent approach to expanding its platform while building a revenue model Payments Service November 2014 Paid Content Distribution January 2015 Gamiﬁcation of User Activity September 2015 SNAPCASH DISCOVER TROPHY CASE

Sources: Fortune, WSJ, Skift, TechCrunch,
Activate analysis 30 MESSAGING www.activate.com New consumer businesses are being built on messaging platforms — this will expand as messaging bots become more ubiquitous Platform-Speciﬁc Messaging Businesses (Operate through At-Scale Messaging Services) POCKETTOUR Travel agency built on top of Viber for easy booking and correspondence with agents Third-Party Travel Agency on Viber TRAVEL First-Party Bank Built by WeChat Online-only bank that operates outside the WeChat interface but uses WeChat login credentials for its accounts PERSONAL FINANCE Third-Party Bot on WeChat Bot that helps WeChat users search for jobs based on Q&A style conversations CAREER Jobot

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 35www.activate.com

Sources: U.S. Census, Edison Research,
Activate analysis 40 STREAMING AUDIO www.activate.com Today, young listeners spend more time listening through streaming, but AM/FM radio remains the largest overall Daily Listening to Streaming Services vs. AM/FM by Age Group, U.S. 2014 PERCENTAGE OF DAILY LISTENING TIME Streaming Services AM/FM 45%55% AGE 13-17 65%35% AGE 17-34 83%17% AGE 34-55 94%6% AGE 55+

45 STREAMING AUDIO www.activate.com Subscriber
loyalty will present a challenge to new services, but YouTube has a shot because music listeners are willing to pay Consumer Preferences in the Digital Streaming Music Space EXISTING STREAMING SUBSCRIBERS: WILLINGNESS TO SWITCH TO ANOTHER SERVICE POTENTIAL STREAMING SUBSCRIBERS: PRICE TO JOIN A YOUTUBE STREAMING SERVICE, COMPARED TO EXISTING SERVICES 64% THE SAME 7% MORE 29% LESS78% NO 15% YES, AT $5/ MONTH 5% YES, AT $10/ MONTH 2% YES, AT OVER $10/ MONTH Sources: Activate survey of adults 18+, October 2015, Activate analysis. Excludes consumers who are unlikely to or will not subscribe to a music streaming service in the next 12 months n=220 n=342

Sources: Apple, SoundCloud, Spotify, Pandora,
Interviews, Activate analysis 46 STREAMING AUDIO www.activate.com What could make a major new entrant successful? Original, unique songs as found on SoundCloud and YouTube will be a critical factor ~1.5 million ~30 million 100 million+ ~30 million 120 million+ LABEL CONTENT OFF-LABEL CONTENT Number of Tracks on Digital Streaming Services

Sources: Spotify, Apple, Activate analysis
48 STREAMING AUDIO www.activate.com Another major area of differentiation will be smart curation that combines human and algorithmic methods Emphasis on algorithmic recommendations with personalized “Discover Weekly” playlists Emphasis on human curation with Beats1 radio station HUMAN ALGORITHMIC

Sources: Interviews, Activate analysis 49
STREAMING AUDIO www.activate.com Some of the features that enable new players to succeed may revisit features from past generations of digital music services SOON SOCIAL SOCIALSOCIAL SEARCH SEARCHSEARCH PLAYLISTS PLAYLISTSPLAYLISTS First generation social sharing services offered more utility than today’s features Despite Facebook integration, users can’t see friends’ listening history or libraries The most successful streaming services will allow for seamless viewing of friends’ playlists and integrate social networking into curation algorithms Listeners are able to discover new music through web popularity and the ambient world Innovative tagging and search features enabled simple access to a wide variety of content Universal audio search engines will allow listeners to ﬁnd tracks across different streaming services Users could choose between their own playlists and algorithmic selections Services can aggregate playlists from a variety of different sources, and centralize a user’s lists A combination of user selection, expert curation, and recommendation algorithms will help users create a personal stream NOWTHEN

51 STREAMING AUDIO www.activate.com There
may be an upper bound to the number of consumers that are willing to pay for a subscription music service U.S. Consumer Likelihood of Purchasing Music Streaming Subscription in the Next 6 Months Only an additional 10% of consumers are open to subscribing to a streaming service 32% UNLIKELY 34% WILL NOT 15% ALREADY HAVE ONE 2% VERY LIKELY 8% SOMEWHAT LIKELY 9% NEUTRAL Sources: Activate survey of adults 18+, October 2015, Activate analysis n=1516

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 58www.activate.com

62 SO, IS IT TRUE
THAT “THE FUTURE OF TV IS APPS”? www.activate.com YES, BUT THAT DOESN’T MEAN EVERYBODY WILL CUT THE CORD. IT MEANS THAT APPS WILL DEFINE THE EXPERIENCE, BUT WON’T DECIDE WHO GETS PAID FOR TV AND VIDEO.

66 THE PAY TV TRANSITION
IS DIFFERENT www.activate.com CHANGES IN THE TV MARKET ARE NOT JUST A SIMPLE TECHNOLOGY TRANSITION. CORD CUTTING WON’T HAPPEN OVERNIGHT.

67 Four reasons why cord
cutting on TV won’t look like a typical tech transition X C www.activate.com USERS: People are still hooked on traditional TV and are consuming more video overall (Pay TV + OTT) CONTENT: A signiﬁcant amount of popular content is still exclusive to pay TV (e.g. sports) PRICING: People can’t cobble together the content they want for a lower price than a pay TV package EXPERIENCE: Today, traditional pay TV still wins for simplicity and reliability. Digital offers more power, control and discoverability, but also more complexity CORD CUTTING

Consumer behavior has moved beyond
traditional appointment viewing and has created audiences for new kinds of content 73 CORD CUTTING X C www.activate.com RECORDEDLIVE LONG FORM High Production Value SHORT FORM Low Production Value Social Networking, Additive to Overall Video On-demand viewing Linear Appointment Viewing Creator- driven, Could Disrupt Quadrant Above Source: Activate analysis

*Percentages refer to regular season
games only **Most markets; some smaller markets have select games on broadcast Sources: Deadspin, NBA, NFL, MLB, NHL, ESPN, Activate analysis. NCAA refers to football only; live post season games not available OTT (authenticated only). CORD CUTTING X C www.activate.com Pay TV still holds the reins on the ultimate appointment viewing: live sports, where synchronous viewership is the norm 74 National Broadcast National Pay Local Pay** Pay Channels Required Live OTT? 0.95 0.05 - 4 Out of market 3% + Finals 10% + Playoffs 0.87 5 Out of market .05% + Finals 5% + Playoffs 0.94 5 Out of market Stanley Cup Only 7% + Playoffs 0.93 2 Out of market 16% + Bowls 84% + Bowls/Playoff — 2-7 N/A PERCENTAGE OF LIVE GAMES* • Fragmentation of rights among local and national networks makes it challenging to offer comprehensive sports packages at price points lower than Pay TV • Sports networks are also subsidized by the bundle, which will limit in-market OTT offerings for the foreseeable future

75 X C www.activate.com While
some premium channels offer over the top subscriptions, much of the most popular cable programming is still exclusive to pay TV Cable Programming Sports Not AvailableCurrent Season OTT Availability Not Available** *National broadcast and inclusion of select local affiliates **Availability on mobile through NFL Mobile on Verizon, and DirecTV Sunday Ticket where DirecTV is unavailable Sources: HBO, Nielsen, Showtime CORD CUTTING

Sources: AOL, Yahoo, BuzzFeed Company
Websites, Activate analysis CORD CUTTING X C www.activate.com Digital media companies are investing in originals but haven’t had a hit yet - they lag behind web creators and studio shows 78 Media Company Content Distribution Strategies Free, ad-supported video blending original content with 3rd party partners • Available videos range from short news clips to full-length ﬁlms • Offering includes 12 originally produced TV series On-demand streaming service for TV shows, movies, and webisodes • Screen has 26 channels, which includes original episodes of Community • Upcoming slate of original programming will bring total to 55 video series Widely distributed short-form original videos targeted at millennials • Library includes 10 original series and over 700 original short videos • Distribution includes a YouTube Channel with 7.8M subscribers SCREEN

84 THIS IS PAY TV’S
GAME TO LOSE www.activate.com BECAUSE CREATING AN OVER THE TOP BUNDLE IS EXPENSIVE AND COMPLICATED, CABLE COMPANIES CAN MOUNT A STRONG DEFENSE. THEY’LL HAVE TO KEEP INNOVATING AND STAY NIMBLE, BUT THEY CAN SLOW DOWN THE THREAT OF CORD CUTTING.

What will it take for
Pay TV to stay competitive against challengers? 85 CORD CUTTING X C www.activate.com An intuitive and user-friendly experience across platforms Integrated search capabilities across video providers, regardless of source Smarter discovery capability, modernizing the set top experience A deep content library Enhanced tools for time-shifted and offline viewing

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 86www.activate.com

92 THE “CABLE KILLER” WON'T
BE A LOW-PRICED COMPETITOR, IT WILL BE “SMART CABLE” www.activate.com JUST AS SMARTPHONES FIRST DISRUPTED THE WIRELESS MARKET (AND INCREASED MONTHLY BILLS) BY CREATING A SUPERIOR HIGH END EXPERIENCE, SMART CABLE COULD TARGET THE MOST LUCRATIVE AND PROFITABLE CUSTOMERS.

What would a “cable killer”
have to do to compete with a cable company’s advantages? 93 CABLE KILLER X C www.activate.com Bundle for distribution. Players that have established a foothold with consumers by selling devices like smartphones or set-top boxes can offer content subscriptions on top Bring your own broadband. Allow consumers to bring their own, or include with partner provider or new competitor Better search and discovery. Search capabilities across video providers, regardless of source, uniting TV content and web videos Seamless access. Integrated platform to access all types of video content - Digital Subscriptions, Web Video, TV Everywhere - across all devices Simplicity and customer service. Easy choices with price transparency and customer- friendly policies to contrast with current cable frustrations Premium pricing (that’s worth it). Target the high end of the market, preserving margins while paying for higher content licensing costs - and integrating all other subscriptions for one monthly bill

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 94www.activate.com

Sources: Digitaltrends, Raptr, Valve, The
Verge, VGChartz, Activate analysis. Based on registered/active users and unit sales as applicablewww.activate.com GAMING AND WAGERING C 98 The top games across PC/Web, Console and Handheld are increasingly multiplayer – mobile is the exception Most Popular Games by Platform Online Multiplayer PC/Web Mobile Console Handheld

107 GAMING AND WAGERING C
www.activate.com WAGERING Real-money betting layer into games and other digital entertainment experiences New form of video game MONETIZATION (beyond ads, Freemium, Subscription) SKILL-BASED - require players to make multiple decisions and use strategies (not games of chance) SOCIAL - creates an environment of community and competition First person and spectator mainly on online multiplayer games, eSPORTS EVENTS Wagering defined

Battle Arena (MOBA) First
Person Shooter (MMOFPS) Role-Playing Game (MMORPG) Strategy Games www.activate.com GAMING AND WAGERING C Source: GameSpot, MMOBomb, Raptr, Reddit, VentureBeat, Activate analysis 113 Top multiplayer online games with mass audiences will likely be the first to feature wagering Examples of Popular MMO Games by Type Massively Multiplayer Online Games

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 116www.activate.com

117 THE DREAM OF THE
INDEPENDENT DEVELOPER BUILDING A BUSINESS IN THE APP STORE IS OVER www.activate.com

119 THE APP ECONOMY www.activate.com
The number of developers on a platform doesn’t matter if the top 20 publishers take most of the money Total: $15B OTHER 280,000+ DEVELOPERS TOP 20 DEVELOPERS $358M per developer $7B <$28K per developer $8B OTHER 380,000+ DEVELOPERS Total: $8B TOP 20 DEVELOPERS $265M per developer $5B <$8K per developer $3B 64% 48% Sources: App Annie, appFigures, Apple, Google, PocketGamer.Biz, Think Gaming, Activate analysis

120 THE APP ECONOMY www.activate.com
Despite massive number of available apps, users are downloading and using the same number of apps Sources: eMarketer, Flurry, Nielsen, Activate analysis 2012 2013 2014 8.88.88.6 U.S. MOBILE USERS: AVERAGE NUMBER OF DOWNLOADS/MONTH 2012 2013 2014 26.726.826.5 U.S. MOBILE USERS: AVERAGE NUMBER OF APPS USED/MONTH Number of downloads remain unchanged… …as do the number of apps used

Sources: Activate analysis 124 THE
APP ECONOMY www.activate.com A new wave of companies are building businesses by using the app store for distribution and engagement, but not monetization

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 125www.activate.com

Sources: Company financials, comScore, eMarketer,
and Activate analysis. ARPU based on consolidated US revenues except: Comcast ARPU is based on Residential & Business Services and advertising within the Cable Communications division. Verizon Wired based of Consumer ARPU, and Wireless based off retail post-paid ARPU. TWC includes Subscription Revenue for Residential & Businesses services along with advertising, AT&T Wireless based on post-paid services. Netflix is streaming revenues only. 126 WHO GRABS THE MONEY www.activate.com Not surprisingly, the Pay TV providers continue to capture the highest average revenue per user in the U.S. $12$13$17$29$54 $95$119$149 $661 $726 $1,007 $1,443 $1,492 $1,570 ARPU YoY Growth ’13-‘14 Annual ARPU: U.S., 2014 -7.9% -2.5% 51.9% 54.7% 8.3% 26%11.2%4.1%12.3%1.2%4.5%2.5%11.3%4.4%

THE AVERAGE AMERICAN SPENDS MORE
TIME ON TECH & MEDIA THAN WORK OR SLEEP MESSAGING WILL BLOW PAST SOCIAL NETWORKS AS THE DOMINANT MEDIA ACTIVITY THE NEXT BIG WINNERS IN STREAMING AUDIO ARE ALREADY (QUIETLY) HERE THE LONG-AWAITED CORD CUTTING MOMENT IS STILL FAR OFF THERE IS A “CABLE KILLER” COMING, BUT IT WON’T LOOK LIKE YOU EXPECT E-SPORTS & WAGERING WILL CHANGE THE GAME IN GAMING GOOD LUCK GETTING RICH IN THE APP STORE! THESE COMPANIES ARE GRABBING ALL THE MONEY IN CONSUMER TECH & MEDIA ONE SIMPLE WAY TO PREDICT WHAT TECH & MEDIA PLAYERS WILL DO NEXT TO COMPETE 128www.activate.com

133 COMPANIES THAT CAN’T BUY
THEIR WAY INTO A LAYER OF THE STACK WILL TRY TO “OVERLAY” IT www.activate.com BIG PLAYERS MAY ATTEMPT TO ENTER NEW LAYERS BY USING THEIR MARKET STRENGTH IN ADJACENT LAYERS RATHER THAN THEIR DEEP POCKETS.

Google Now, Apple Siri and
Microsoft Cortana overlay other search and messaging layers by providing a user interface which bypasses competitors’ services completely Amazon Echo overlays Internet of Things products from other companies, forming an intermediary layer that lets Amazon retain control over the user experience of those devices Slack’s uniﬁed search doesn’t just provide access to chat messages in Slack, but the contents of ﬁles in apps that are connected to Slack, overlaying productivity software in adjacent layers Microsoft Ofﬁce 365 is now available on every operating system, overlaying platforms like Android and iOS with an enterprise layer that Microsoft controls Apple TV overlays the offerings of cable companies and over the top video providers by adding an interface which can search for content without regard for its source, putting control in Apple’s hands 134 Major technology players and upstarts are already implementing an overlay strategy for fiercely competitive layers www.activate.com UNIFIED STACK